My parts arrived on Friday and I built the machine Friday evening, installed Windows 7 and XBMC and tested it out, it works well but some files do not play back smoothly, I am sure this is not related to my machine, likely drivers or settings, needs more tweaking.

I followed the steps below after the initial issues with the playback and they are still happening.

My setup is, PC>AVR Onkyo>LCD all using HDMI.1. If you installed Realkek, you can un-install it
2. Make sure to up date the latest AMD driver from here- AMD Driver Autodetect
3. Select AMD High Definition audio output in Windows 7 control panel/hardware and sound/sound/playback
4. If you have AVR, you need to select "Audio output device WASAPI: "AVR brand/model go here" (AMD High Definition......)" in XBMC
5. Enable DXVA2 and select DXVA as Render method and disable everything else in XBMC system/video/playback
6. Enable "Use fullscreen window rather than true fullscreen" in XBMC system/system/vdeo output